TORONTO — George Weston Ltd. and Loblaw Companies Ltd. on Dec. 19 detailed their role in an industry-wide price-fixing arrangement spanning 14 years and involving certain packaged bread products.

“The allegation of price fixing is being investigated by the Competition Bureau, which has searched a number of major grocery retailers and bread wholesalers,” Galen G. Weston, chairman and chief executive officer of George Weston Ltd. and Loblaw Companies, said during a Dec. 19 conference call with analysts. “As previously reported, the Competition Bureau has commenced an investigation into a price-fixing arrangement. The arrangement involved the coordination of retail and wholesale prices of certain packaged bread products over a period extending from late 2001 to March 2015. Under the arrangement, the participants regularly increased prices on a coordinated basis. The participants included Loblaw and the Weston Bakeries division of George Weston, as well as other major grocery retailers and another bread wholesaler, some of which have acknowledged being searched by the Competition Bureau as part of its ongoing investigation.”

Mr. Weston described the price-fixing and subsequent investigation as “a difficult matter” and “clearly something that never should have happened.”

“In March 2015 we uncovered information that raised concerns,” he said. “We immediately reported what we had found to the Competition Bureau and have been cooperating fully with the Bureau since.”

Mr. Weston said the Competition Bureau was not investigating the price-fixing allegations prior to being alerted by Loblaw and George Weston in March 2015.

He added, “We can’t speculate on which parties the Bureau will pursue or in relation to which bread products or what time period.”

As a result of their admission that they participated in the price-fixing arrangement and given their cooperation with the Competition Bureau’s investigation, neither George Weston nor Loblaw will face criminal charges or penalties.

Since learning of the anti-competitive behavior in March 2015, Mr. Weston said George Weston and Loblaw have taken four courses of action.

First, the companies immediately reported the price-fixing arrangement to the Competition Bureau and began cooperating fully with the agency.

Second, the companies removed the employees responsible for Weston Bakeries’ and Loblaw’s role in the price-fixing arrangement.

Third, Mr. Weston said it is offering customers a $25 Loblaw Card, which may be used to purchase items sold in Loblaw grocery stores across Canada. Eligible participants will be able to apply for a card at www.LoblawCard.ca between Jan. 8 and May 8.

“This is our effort to respond directly to our customers, acknowledging ultimately our specific accountability in what was an industry-wide arrangement,” Mr. Weston said. “We’re trying to go directly to our customers and let them know how serious we’re taking the situation.”

Finally, Mr. Weston said George Weston and Loblaw have ramped up their compliance programs with measures that go beyond the Competition Bureau’s own requirements. The measures include the establishment of a new independent compliance office, led by a chief compliance officer; intensive compliance re-training and certification, with ongoing updates and monitoring; and a commitment to begin implementation of ISO 19600 for competition compliance program certification.

George Weston and Loblaw said class-action lawsuits have been initiated against the parties involved in the price-fixing arrangement and are expected to proceed on the basis of the searches conducted by the Competition Bureau.

“It is too early to predict the outcome of any class actions that could be brought against us,” said Richard Dufresne, chief financial officer of Loblaw Companies. “In practice, class action in this area are usually resolved through settlement.”

Mr. Dufresne said the companies would be open to any settlement that is “reasonable and in the best interests of the companies, taking all relevant factors into consideration.”

He said it will take a provision during the quarter in relation to the Loblaw Card program, which is expected to cost between C$75 million and C$150 million. In addition, both George Weston and Loblaw may take a charge in the period in which they can reliably estimate damages or the matter is resolved, he said.

Other parties that earlier confirmed they were part of the investigation include Canada Bread, Walmart Canada and Metro Inc. Metro Inc., which operates more than 600 stores under the banners Metro, Metro Plus, Super C and Food Basics, issued a statement on Dec. 19 saying it continues to fully cooperate with the authorities and has launched its own internal investigation.

“Based on the information processed to date, we have found no evidence that Metro has violated the Competition Act, and we do not believe that the Bureau’s investigation will have a material adverse effect on the corporation’s business, results of operations or financial condition,” Metro said. “Legal compliance is fundamental to Metro, and the corporation has a code of conduct in place applicable to all employees. The corporation will not issue any further comments.”

Sobeys Inc., which owns or franchises approximately 1,500 stores throughout Canada, on Dec. 20 said it was provided with substantive information by the Competition Bureau for the first time on Dec. 19.

“At this time, Sobeys does not believe that it or any of its employees have violated the Competition Act,” the company said. “Any assertion of an industry-wide price-fixing arrangement has not been proven. Sobeys has always taken its compliance obligations seriously. Sobeys will continue to fully cooperate with the Competition Bureau as it continues its investigation."

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